This area has the state's second highest average rents

Rents have hit an all-time high across the state as apartment buildings fill up, and the Loveland-Fort Collins area is leading the way.

The average rent of $1,024.74 for all apartment types in Loveland and Fort Collins was the second highest of all markets in Colorado, trailing only Aspen, where the average stood at $1,032.91 in the third quarter.

In a report released Thursday, the state Division of Housing said rents across the state averaged $944, the highest ever recorded and a 5.1 percent increase over the $898 average during the third quarter of 2011.

In Loveland-Fort Collins, the $1,024 average represented a 7.3 percent jump since the same quarter a year ago.

Loveland's rents, when broken out from the market area total, actually showed a decline from the third quarter of 2011. This year's third-quarter average of $944.18 was down 5.7 percent from last year's $1,000.80

Rents in Fort Collins rose 10.1 percent to an average of $1,042.14, driving up the area's total.

Jessica Joles, sales and marketing manager with Loveland-based Henderson Management and Real Estate, said the trends recorded in the state survey track with what her company is experiencing.

Henderson manages more than 1,000 units - about half of them in multifamily properties - in Loveland, Fort Collins and the surrounding areas, she said.

"The reason for the aggressive rental market is there has been a lot of economic growth in this area," she said. "You've got more jobs being created and more need, and that's good."

The Loveland-Fort Collins area also had one of the tightest vacancy rates in the state, at 2.1 percent, compared with 2.3 percent a year ago.

Loveland's rate also was 2.1 percent in the quarter, a tightening of more than a percentage point since the third quarter of 2011, when it was 3.4 percent.

Joles said Henderson Management's companywide vacancy rate is hovering at about 1 percent, and open units are snapped up quickly. "If they find something they like, they really have to move on it because it'll be gone if they hesitate," she said.

Statewide, the rate was 4.6 percent, the lowest since the first quarter of 2001 and a tightening since last year's third-quarter level of 5.0 percent.

A vacancy rate below 5 percent indicates a tight rental market, according to a press release from the Division of Housing.

"Northern Colorado vacancies are at the low levels we saw back in the late '90s," Ron Throupe, a professor of real estate at the University of Denver and the study's author, said in the release.

In Denver, vacancy rates fell to 4.3 percent from last year's level of 4.9 percent, as recorded in a separate survey released last month. Rents in Denver averaged $986.

According to the statewide report, a family looking for a three-bedroom apartment in Loveland or Fort Collins could expect to pay $1,251.50 a month in rent. Efficiency apartments, by comparison, averaged $731.36.

Joles said the housing collapse of 2008 has pushed some people into the rental market.

"You've got people who either had to file bankruptcy or had foreclosures, so they can't buy right now," but they're not necessarily looking for low-end apartments, she said. "They're used to making $1,500 payments, and they want that quality of life."